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ELRCPartially AllowedEmployment and Labour Relations Claim filed October 16, 2017 (number not stated in judgment)· [2023] KEELRC 838 (KLR)

Mavyuva v Wealth Creator Security Limited (Cause 2067 of 2017) [2023] KEELRC 838 (KLR)

Employment and Labour Relations Court
12 April 2023
2,078 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~8 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that calling a dismissal 'redundancy' without following the legal steps makes it an unfair termination worth compensation.

What this practically means

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Executive summary

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The claimant sued Wealth Creator Security Ltd alleging unfair termination on account of redundancy on May 7, 2017 and non-payment of terminal dues, claiming Kshs.326,538/=. The respondent never entered appearance or filed a response, and the matter proceeded as an undefended claim heard on January 23, 2023. The court first satisfied itself that an employment relationship existed, relying on the claimant's NSSF statement showing contributions to the respondent from 2013 to 2017, while noting that neither the pleaded 2012 employment dates nor details of duties and pay were proved. On the redundancy, the court held that section 40 of the Employment Act, 2007 prescribes seven mandatory conditions, including notice to the employee and the Labour Office, selection criteria, and severance pay, together with meaningful consultation. Since none were complied with, there was in law no redundancy but a termination of employment, which lacked both substantive justification and the procedural fairness required by sections 41, 43, 45(2) and 47(5). The termination was therefore unfair. On reliefs, the court awarded one month's salary in lieu of notice, declined salary for April 2017 and seven days in May 2017 for want of proof, declined leave pay for want of evidence, and declined severance under section 40(1)(g) because the remedy lay under section 49(1)(c), under which it awarded the equivalent of three months' salary. A declaration of unfair termination, a certificate of service, costs and interest were granted. Judgment was delivered virtually at Nairobi on April 12, 2023.

Key legal issues

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01

Existence of employment relationship

Holding

Claimant was an employee of the respondent from July 2013 to early 2017, established principally by the NSSF statement

Reasoning

Apart from the NSSF statement identifying the respondent as the claimant's employer from 2013 to 2017, no other evidence connected the claimant to the respondent. The pleaded employment dates of October/November 2012 were not proved. Since the averments were uncontroverted, the court adopted the NSSF dates.

p. 3
02

Whether the purported redundancy was lawful

Holding

No redundancy occurred; non-compliance with section 40 rendered it an unfair termination

Reasoning

Section 40 prescribes seven mandatory conditions including notice to the employee and the Labour Office, selection criteria and severance pay, plus meaningful consultation. None were complied with, so the May 7, 2017 declaration was in substance a termination of employment rather than a redundancy.

p. 4
03

Whether the termination was unfair

Holding

Termination was unfair for want of substantive justification and procedural fairness

Reasoning

Sections 43, 45(2) and 47(5) require substantive justification while section 41 and section 45(2)(c) require procedural fairness, including notice and hearing. There was no evidence of compliance with any of these prescriptions, and the claimant was dismissed by word of mouth without notice.

p. 4
04

Quantum of compensation

Holding

Three months' salary awarded under section 49(1)(c)

Reasoning

The court considered about five years of service, the claimant's non-contribution to the termination, and the fact that he did not appeal the director's decision or show a wish to continue in employment, concluding three months' equivalent salary was fair.

p. 5

Legal principles established

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  • Section 40 of the Employment Act is mandatory; non-compliance converts a purported redundancy into an unlawful termination
  • In an undefended claim the claimant must still establish the employment relationship and prove the claim on a balance of probabilities
  • Termination must be both substantively justifiable and procedurally fair

Court orders

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  1. 1.Declaration that termination of the claimant's employment was unfair
  2. 2.One month's salary in lieu of notice
  3. 3.Equivalent of 3 months' salary as compensation under section 49(1)(c) of the Employment Act
  4. 4.Certificate of service
  5. 5.Costs of the suit to the claimant
  6. 6.Interest at court rates from the date of judgment till payment in full

Authorities

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Legislation

  • Employment Act, 2007sections 2, 40, 40(1)(a), 40(1)(g), 41, 43, 45(2), 45(2)(c), 47(5), 49(1)(c), 51
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure Actsection 1B
  • Constitution of Kenya, 2010articles 159(2)(d) and 48

Cases cited (11)

  • Luke Kinyua Kamunti v Amigos Nuts and Commodities Ltd
    (2019) eKLR
  • Dennis Leak Ojuok v Population Services Kenya
    (2022) eKLR
  • Humphrey Munyithya Mutemi v Soluxe International Group of Hotels and Lodges Ltd
    (2020) eKLR
  • Monica Karimi Mutua v Al Arafat Shopping Centre & another
    (2018) eKLR
  • Nicholus Kipkemoi Korir v Hatari Security Guards Ltd
    (2016) eKLR
  • Freight In Time Ltd v Rosebell Wambui Munene
    (2018) eKLR
  • Barclays Bank of Kenya Ltd & another v Gladys Muthoni & 20 others
    (2018) eKLR
  • Thomas De La Rue (K) Ltd v David Opondo Omutelema
    (2013) eKLR
  • Kenya Airways Ltd v Aviation & Allied Workers Union Kenya & 3 others
    (2014) eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    (2013) eKLR
  • Pius Machafu Isindu v Lavington Security Guards Ltd
    (2017) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Mavyuva v Wealth Creator Security Limited (Cause 2067 of 2017) [2023] KEELRC 838 (KLR)", Case Analysis (2023). Employment and Labour Relations Claim filed October 16, 2017 (number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/838/eng@2023-04-12

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.